American: Protecting its New York Turf
By Ted Reed 08/18/10 - 01:53 PM EDT
DALLAS (TheStreet) -- After 84 years of operating in New York, American Airlines(AMR) is not backing down in the face of dramatic expansion by its competitors.
"It's a major issue for us to protect our turf here," said Art Torno, a 31-year American veteran who took over as vice president for New York in March. A big advantage for American, Torno said, is the $1.3 billion terminal the carrier opened at Kennedy Airport in 2007. "That terminal is the place to be, one of the finest in the country," he said. "It's modern, state of the art and roomy."
Now American is trying to squeeze more synergies out of the terminal. (Kennedy is among the few airports where terminals can be dedicated to a single airline.) For instance, it will move in more alliance partners now that regulators have approved a trans-Atlantic joint venture and may soon approve a trans-Pacific joint venture as well. American also wants to boost its level of cooperation with JetBlue(JBLU), Kennedy's largest domestic carrier, to enhance the feed to its international flights.
One thing American cannot afford to do is stand still, because competitors are ramping up dramatically in New York. Delta(DAL), already growing in New York, said last week it will spend $1.2 billion to upgrade its terminal at Kennedy.
Meanwhile, United(UAUA) awaits regulatory approval for a planned merger with Continental(CAL). Perhaps the biggest single prize in the merger is Continental's Newark hub, which will become the New York gateway for the world's biggest airline.
The Newark hub means that "Continental is in the driver's seat" in New York, said Stifel Nicolaus analyst Hunter Keay.
But the region is too important for any Big Three airline to step back. "No one has retreated," said consultant George Hamlin. At LaGuardia, US Airways(LCC) sought to tactically pull back by trading slots to Delta in exchange for slots at Washington Reagan National, but regulators blocked that deal.
Kennedy is the epicenter because three of New York's four principal airlines operate hubs there. In March, American signed a deal with JetBlue that included an interline agreement and some slot trades. Now efforts are underway to expand on that. For instance, as TheStreet reported previously, American and JetBlue are talking about a code share, an extremely close cooperative agreement in which carriers can write tickets on one another's flights.
Unfortunately, the lack of a shared terminal means 90-minute connect times between flights, when an hour or less is typical for dual-airline connects. At Kennedy, connecting passengers must take a bus between terminals and pass through security a second time. But Torno said American and JetBlue envision a bus that would keep connecting passengers on the sterile side of security, reducing the connect time to 60 minutes. Conceivably, the bus will begin running whenever the code share starts, but the two carriers are not rushing to expand the agreement. "We're taking baby steps to make sure what we are doing makes sense," Torno said.
As far as American's partners in the Oneworld alliance, they too could be housed in American's terminal. Currently, partners including AirBerlin, Finnair and Malev are occupants. "We would like to see a facility that is the Oneworld New York gateway," Torno said. "We're in deep negotiations with British Airways to come in, [although] we're not close to finalizing them." Iberia could also be an occupant, as could Japan Air Lines, assuming an application for trans-Pacific joint immunity is approved.
Similarly, American's joint venture partners are moving to house their sales teams in a single midtown office building. "We will co-locate in one office, with fully-integrated sales forces working side by side." Torno said. "When we go to negotiate a deal, we will go in together."
As for LaGuardia, the close-in New York airport, American ranks second to Delta. In 2009, according to figures compiled for TheStreet by OAG Consulting, the combined passenger total for Delta, Northwest and regional affiliates was about 6 million passengers. American and American Eagle carried 4.7 million passengers. Third-place US Airways and regional affiliates carried 4.2 million passengers.
November schedules show that Delta will provide 33% of LaGuardia capacity, while American will provide 20% and US Airways will provide 19%, said OAG. American has been building its LaGuardia schedule, adding American Eagle flights to Minneapolis, Atlanta, Raleigh-Durham and Charlotte on CRJ-700 regional jets that have first class cabins, as well as increased mainline service to Miami and Chicago.
Despite all the improvements, Avondale Partners analyst Bob McAdoo said he views American as New York's no. 4 carrier. The Kennedy terminal is spacious and imposing, but American doesn't utilize it sufficiently -- which is why alliance partners are being welcomed with open arms.
Additionally, he said, American has not sought to provide the type of classic hub that Delta has. While Delta has 876 weekly departures from Kennedy, not only to major cities but also to Akron, Burlington, Vt., and Indianapolis, American has just 426. "I look at the number of cities one guy brings to town versus another, the number of possible connections," McAdoo said. "It's one thing to say 'New York to London Heathrow is wonderful' and 'I have some good markets.' It's another to say, 'I have a hub.'"
Torno said the American strategy in New York, as elsewhere, is to serve the best, most profitable routes, such as Heathrow and Los Angeles and Chicago, and, in January, Tokyo Haneda as well as Tokyo Narita.
"We may not be the biggest in New York," he said. "But we are big where it counts."
-- Written by Ted Reed in Charlotte, N.C.
American Airlines to charge for front-row seats
American Airlines to start charging $19-$39 for seats in the first few rows of coach cabin
Samantha Bomkamp, AP Airlines Writer, On Wednesday August 18, 2010, 3:56 pm EDT
NEW YORK (AP) -- American Airlines has found another fee.
The Fort Worth, Texas, airline said Wednesday it's now charging between $19 and $39 for "Express Seats" -- those spots in the first few rows of coach that include bulkhead seats.
American said the price of the seats includes getting on the plane in the first "general boarding" group of passengers. The seats that will cost extra are in the first two or three rows of the coach cabin, depending on the size of the plane.
Anne Banas, executive editor of SmarterTravel.com, thinks passengers will see more packaged fees like this in the future -- where benefits like free standby or boarding perks are included.
The carrier, which is operated by parent AMR Corp., is following in the footsteps of several other airlines who already charge for special seats. UAL Corp.'s United Airlines, Continental Airlines, US Airways, JetBlue, Frontier, Spirit and AirTran all have some seats that cost extra.
The American seats don't give passengers much extra for their money, said Steven Hall of CompareAirlineFees.com. Most of the other airlines' premium seats offer more legroom. But it is a benefit for passengers to be among the first to board the plane, he added.
The seats on American can only be bought at airport kiosks between 24 hours to 50 minutes before the flight for travel within the U.S.
American, the country's second-largest airline behind Delta Air Lines, still provides its elite frequent fliers those seats for no extra charge. American also charges fees for checked bags, priority boarding, booking on the phone or in person, "sleep sets," unaccompanied minors and pets.
On Tuesday, AirTran raised its fee for the first checked bag by $5 to $20 for travel starting in September. The cost is now on par with bigger airlines.
U.S. airlines collected about $1.9 billion from fees in the first quarter, the most recent period for which data is available from the Transportation Department. American's share of that was $261.1 million.
AP Airlines Writer David Koenig in Dallas contributed to this report.
Flight attendants: Bartenders or bad cops?
Hard-working airline crews juggling conflicting responsibilities
updated 8/17/2010 9:48:58 AM ET
Morris MacMatzen / Reuters
Given the agitation among both paying customers and the uniformed personnel, should the airlines formally and forcefully reaffirm the authority of flight attendants?By Bill Briggs
Steven Slater’s intercom-cussing, double-fisted slide into resignation — has launched a fresh examination of the two-faced persona all flight attendants are asked to master: grinning snack server one moment, frowning rules enforcer the next.
From bartender to bad cop in a snap.
In an era of “current threat levels,” and within a tense flying environment that gives new meaning to “cabin pressure," is it smart to ask airline crews to juggle such outwardly conflicting responsibilities?
Flight attendants have recently demanded and won heftier federal fines for unruly customers, and have been officially designated “first responders” — someone certified to provide pre-hospital care in a medical emergency — by the Department of Homeland Security.
Yet they are earning less and sleeping less, harder-worked and higher-stressed — all while tending to a seemingly rising number of passengers who board toting an edgy “sense of entitlement,” according to associations representing both U.S. airlines and flight attendants.
While the trade groups carefully veer around the central question — does fluffing pillows and dishing pretzels erode a cabin crews’ vital onboard authority — one former flight attendant believes that’s precisely the psychology taking root in the minds of some fliers.
“Yes, in a way, the service that people see day in and day out does make people forget and it does undermine the ... responsibility that the crew members have for the safety and well being of the passengers,” said Carolyn Paddock, a Delta Air Lines flight attendant for 17 years.
.“At times, it is difficult to balance being helpful and a good host, and then having to police people,” added Paddock, who left Delta about three years ago, launching InFlightInsider.com, a website offering tips on traveling smart and stylishly.
But as flight attendants shove massive snack carts through the aisles, they offer passengers just a tiny glimpse of jobs that have gained deep complexity since Sept. 11 — jobs that pay an average of $35,000 a year, according to Corey Caldwell, spokeswoman for Association of Flight Attendants-CWA, a labor union representing more than 50,000 flight attendants at 22 airlines. "However," Caldwell noted, "most newly hired flight attendants and those who have only been at their carrier for just a few short years often make less than $20,000 a year."
“What [travelers] never see, and what they’re not supposed to see,” Paddock said, “are the inner workings of what it takes to make a flight safe, secure, and work well.”
So what happens behind the curtain? “In the interest of your safety, I cannot reveal what goes on,” Paddock said. “But trust me when I tell you that there is more that meets the eye ... What I can say is the crew is making assessments. Who are the passengers most likely to help in an emergency? Who is acting or looks suspicious? Who looks unwell? Are they unwell enough to fly? Who is sitting next to that little unaccompanied minor and is she OK sitting next to that passenger? ... At times, being underestimated works to the crew's advantage.”
That “underestimation” — or, put bluntly, lack of respect — also reflects what flight crews see on the clock and off, at their hotels, at the mall, on the freeway, or in their neighborhood grocery store: a self-involved, me-first mentality, said David Castelveter, vice president of communications at the Air Transport Association of America. (The ATA is the nation’s oldest and largest airline trade group.)
“More than ever before, there’s a sense of entitlement in society and that’s what creates the challenges for these flight crew members,” Castelveter said. “At the end of day, we’re in the customer service business and the old adage ‘the customer is always right’ is still the norm. But we have to find that balance between the customer being right and [a flier who] does something that creates a potential hazard or inconvenience for another passenger.”
Msnbc.com contacted three domestic airlines to discuss the state of flight attendant authority. Southwest spokesperson Paul Flanigan said he would not discuss whether the Slater incident indicated that U.S. airlines, in general, needed to re-examine or address the command or clout held by flight attendants inside the cabin. "We, to date, have declined all media inquiries regarding the JetBlue incident," he said, and referred questions to ATA. United and JetBlue, meanwhile, did not respond to interview requests on the topic.
“It’s absolutely a rising factor,” said Beth Blair, a Southwest Airlines flight attendant until 2004 and now a travel writer whose job has put her in the sky as often as three times a month. “There are the people who are always looking for anything free. For example, passengers assume they deserve a complimentary upgrade just because a seat is available or they should be granted a free drink because their flight was slightly delayed.”
When such accommodations are not met, some passengers “simply stew in their seats while others react with an outburst which may or may not make the news,” Blair added.
The worst offenders? “Frequent fliers,” Blair said. They are “most likely to break safety rules such as cell phone use or not paying attention to safety briefings.”
Amid these ill-mannered trends — and following Slater’s famous meltdown last week (which may or may not have been sparked by bad passenger behavior) — has the time come for airlines to take pre-emptive action? Must they formally remind passengers of who is in charge in the cabin, and that it’s a federal crime, now punishable by a $25,000 fine, to disobey or interfere with flight attendants?
That question comes with two critical caveats. First, due to post-9/11 union concessions that helped keep airlines in business, flight attendants are paid about 30 percent less than they were before the attacks and they are working about 40 percent more. Fatigue and stress among flight crews are both high, industry experts acknowledge. Couple that with the anxieties many passengers are carrying: strenuous security checks, fewer flight options, jam-packed planes and general worries about terrorism.
“I’m not sure I would say [they must take] official steps,” said Caldwell of the Association of Flight Attendants-CWA. “On a whole, the traveling public understands the role of flight attendants. [But] it certainly doesn’t hurt to remind them again — that flight attendants are certified safety professionals who are required to enforce federal aviation regulations.”
"Remember, their primary responsibility is to ensure the safety of the traveling public," ATA's Castelveter said. "If any passenger is interfering with the duties of the flight crew member, it's a federal crime."
Caldwell concedes, however, that she can envision a day when the service slice of the flight crews’ job is substantially reduced and attendants ride purely to keep the peace and enforce the safety rules.
“That’s definitely a possibility,” Caldwell said. “If you look at the current business model that airline management has sort of set up, yeah that could be a possibility.”
Although, she added, flight attendants always will remain the face of the airlines and, as such, “there will always be just that little customer service angle. It’s the flight attendants who are in the steel tube at 40,000 feet with the passengers.”
Perhaps some airlines ultimately will find the need to designate certain flight crew members as “hospitality” attendants and others as “safety monitors” — both squads with clearly separate duties, perhaps even wearing different attire. That’s unlikely to occur until the economy rebounds, said flight-attendant-turned-writer Blair.
“I think an onboard safety team is a great idea because it does give the crew members a specific role,” Blair said. “I’m not sure, though, if the airlines will see it as practical or financially feasible.”
Still, fliers already recognize that the “service” elements offered by flight crews are dwindling as pillows and blankets become scarce, and as beverages and snacks are cut or switched to pay-only, pre-boxed meals.
“Other flight attendants, pilots and I used to joke that one day vending machines would replace the galley,” Blair said. “It seems like we may be heading in that direction.”
© 2010 msnbc.com Reprints
American, JetBlue Negotiate Code-Share
By Ted Reed 08/16/10 - 04:21 PM EDT
American Airlines/JetBlue story updated with comments from JetBlue.
DALLAS (TheStreet) -- American Airlines(AMR) and JetBlue(JBLU) are negotiating a code-share agreement that could be in place as early as the first quarter of 2011. "We are negotiating, working towards perhaps a code-share in the future," Art Torno, American's vice president for New York told TheStreet. He emphasized that no agreement has been reached so far.
A code-share, which enables airlines to sell tickets on one another's flights, would be a natural step in the increasing cooperation between American and JetBlue, which in March announced plans to work together in New York where both operate hubs at Kennedy International Airport. The two carriers recently announced plans to enable customers to earn frequent flier miles on either airline on connecting flights.
The next step, said JetBlue spokesman Bryan Baldwin, is for the carriers to post interline itineraries on their websites.
"We've said all along that we are open to discussions with American to grow this relationship, but at this time we have no plans to enter into a traditional two-way code-share relationship with American," Baldwin said.
The initial deal involved an interline agreement enabling sales on one another's flights, but the proceeds are remitted directly to the operating carrier. In a code-share, revenue is pro-rated between the airlines and each airline can put its own code on the other's flight. Interline agreements are far more common: American has about 135 interline partners. Both arrangements enable baggage exchange between carriers.
Torno said he has worked closely with JetBlue CEO Dave Barger since the initial deal was announced, but the two carriers want to take things slowly. "We're taking baby steps to make sure that what we are doing makes sense," he said. "Whatever we implement, we want to make sure it works."
As the biggest aviation market in the world, New York is hotly contested. Delta(DAL) said last week it will spend $1.2 billion to upgrade its facilities at JFK .
Meanwhile, a merger between United(UAUA) and Continental(CAL) means the combined carrier will push more traffic through the latter's Newark hub.
Torno said American has a competitive advantage with its $1.3 billion JFK terminal and plans over time to move its alliance partners British Airways and Iberia into the terminal as well. Additionally, if a trans-Pacific joint venture with JAL is approved, that carrier would also be expected to move to the American terminal.
American's parent AMR closed down 0.72% to $6.85 on Monday, while JetBlue shares closed down 0.33% to $5.96.
-- Written by Ted Reed in Charlotte, N.C.
Howie Kurtz Scolds Media Over Coverage Of ‘Bogus’ Steven Slater Story
5:24 pm, August 15th, 2010
Howard Kurtz hates shark week. Kidding! Howie Kurtz simply does not approve of either Steven Slater nor the adoring coverage he received at the hands of the media. Especially the latter. Kurtz saved his Slater rant for the last few minutes of Reliable Sources today, the gist of it being that Slater could have killed someone, and the media has gone overboard in their coverage of his antics (cue: “those darn kids!”).
And here’s what left me with motion sickness: this JetBlue clown, the flight attendant who got ticked off at a passenger, then triggered the emergency chute at JFK Airport and slid his way out of a job and got himself arrested is actually being celebrated by the media.
Yes, I know, it’s August and he’s got over 200,000 Facebook fans. But Steven Slater could have killed someone on the runway with that reckless move. And yet, look at this — front page of “The New York Times,” front page of “USA Today,” front page of the New York tabloids, and television in a tizzy.
Yes, the media went overboard — as much as I enjoyed their coverage, by the end of the week the NYT appeared to have made Stephen Slater their personal mascot. However, in the grand scheme of overdone stories this year (and make no mistake this has been a banner year), overdoing a story 98% of the country enjoys hearing about seems to me to be a lesser sin than say, a beer summit clock
'What he did was despicable,' host of 'Celebrity Apprentice' tells 'The Insider'
8/12/2010 7:26:23 PM ET
America may be embracing JetBlue flight attendant Steven Slater, who famously quit his job this week during an expletive-ridden rant on a loudspeaker.
"Celebrity Apprentice" host Donald Trump isn't.
"What he did was despicable," he tells "The Insider." "I think as an employee he's horrible and as an employer I would really go after him big."
Trump says it is wrong that people are "celebrating" Slater "who could have caused a major catastrophe and who is obviously not very stable. I think he's a wacko. I think he had a [disagreement] with someone close to him and he let it out on the passengers. I don't think he's a hero, and I don't think he's going to be a folk hero for very long. I think we should stop celebrating him pretty quickly."
Meanwhile, several passengers on the Slater's plane tells the Wall Street Journal he was the one who instigated the ugly confrontation that led to his nasty departure.
When one passenger asked Slater where her bag was stowed, he spewed an expletive before storming off.
Said a witness, "It really blew my mind. It was so inappropriate."
Copyright 2010 Us Weekly
Upset flight attendant grabs beer, activates chute, goes home
Witness says Steven Slater looked 'happy' — but is he facing more stress?
A JetBlue flight attendant got into an argument with a passenger on a jetliner arriving at John F. Kennedy International Airport Monday, then grabbed a beer from the galley, deployed an emergency exit slide and fled the plane, authorities said.
And though he could be seen smiling as authorities led him away from his nearby home in the Belle Harbor section of Queens, Steven Slater's acquaintances and his apparent profile on a social networking site indicated that he has been dealing with some stressful events in his life.
Slater was ordered held on $2,500 bail, WNBC's Tim Minton reported. Slater faced charges of criminal mischief, reckless endangerment and trespassing, and was in custody overnight.
By Monday night, several Facebook pages had been set up in tribute to Slater, who is facing charges of criminal mischief, reckless endangerment and trespassing, with many users of the social networking site expressing support for him for walking off the job. One such page had more than 16,000 fans early Tuesday.
Twitter users also showed support, with declarations such as "Free Steven Slater!" and "Steven Slater is totally my new hero."
Slater was working on JetBlue Flight 1052 from Pittsburgh when he got into an argument with the passenger, who was pulling down baggage from an overhead bin, the Port Authority said.
The luggage apparently hit Slater in the head and he asked for an apology, but the passenger refused, the agency said.s the plane was landing, Slater got on the public-address system and cursed at the passenger, the Port Authority said.
He then grabbed at least one beer, activated the slide, slid down and went to his car, it said. Port Authority police were notified about 25 minutes later.
Phil Catelinet, a passenger on the flight, said on the TODAY show that Slater " was smiling — he was happy he had done this. He was happy he was done with his job at JetBlue."
"I think it's funny that he could quit his job that way … [but] I don't think he thought this through."
'One day at a time'
A MySpace profile appearing to belong to Slater notes that: "Beating alcoholism and substance abuse 'one day at a time' has opened up new worlds of opportunity for me, and I am so thankful to those who have guided me along the path to successful living, and given me new wings to fly. See you above the clouds. ..."
Slater's former roommate, John Rochelle, told The New York Times that Slater was rarely home, and often traveled to Thousand Oaks, Calif., to care for his ailing mother.
A neighbor of Slater's mother told the newspaper that he had also cared for his father, who died of Lou Gehrig's disease.
"It could be the pressure of his mother's illness, because that's not the type of behavior or conduct that Steve exhibits," neighbor Ron Franz said. "He's a very conscientious, responsible individual."
A woman who answered a phone at a previous residence listed for Slater in Thousand Oaks, Calif., identified herself as his mother but said she wasn't speaking to the media.
The district attorney told NBC News that Slater had not yet been arraigned, but that was likely to happen at a Tuesday morning court session.
JetBlue Airways Corp. said in a statement that it was working with the Federal Aviation Administration and Port Authority police to investigate the matter.
It said the safety of its customers and crew members was never at risk. JetBlue would not say how long Slater had been employed by the company.
A National Transportation Safety Board official said the incident was a result of "a little too much cabin pressure."
The Associated Press and NBC News contributed to this report.
American: Protecting its New York Turf
